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Silver Prices

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The Price of Silver Has Boosted This ETF 137% Since January

price of silver

The price of silver is fresh off its best monthly gain in three years.

Last week, silver prices hit their highest level since May 2015.

And the rally has given this silver exchange-traded fund more than 137% gains over the last three months...

Our Shocking Silver Prices Prediction for 2016 Shows Double-Digit Gains

silver

Silver prices this afternoon reached their highest level in nearly a year.

But Money Morning Resource Investing Specialist Peter Krauth doesn't see the gains stopping here.

Here's exactly where we see silver prices in 2016...

Three Reasons Silver Prices Will Continue to Climb

Silver prices haven't soared as high as gold this year, but that just means their potential to rise is even brighter…

The price of silver has climbed 12% in 2016, which means it has handily outperformed the broader markets this year. So far in 2016, the Dow Jones Industrial Average, the S&P 500, and the Nasdaq have all fallen 1.2%, 1.1%, and 5.2% respectively.

The biggest reason for the silver price rally has been volatility in the broader market. During the first two months of 2016, the Dow dropped 6.2%. The plunge in the major U.S. indexes resulted from the declining value of the dollar and fears of slowing growth in the global economy.

That fear-induced sell-off made silver more attractive because of its use as a "safe haven" investment. Safe havens are assets that will either increase in value or hold their value when the stock market falls. Because silver prices can tolerate dangerous market conditions, investors use the metal as insurance.

And this year's silver price rally follows one of the longest silver bear markets we had seen in 30 years. Here's a look at how silver prices trended prior to this year's rise…

Silver Price History Chart: How the Metal Has Trended

silver-pricesAs this silver price history chart shows, we saw one of the longest bear markets in history for silver between 2010 and 2015. But it was nothing compared to the silver price crashes we've seen before…

Silver prices on the New York Commodity Exchange (COMEX) have fell more than 70% from their peak of $51.38 in April 2011 through early 2016. That makes that slump one of the worst crashes in silver price history.

But that crash pales in comparison to the silver price crash of the early 1980s. On March 27, 1980, the price of silver collapsed 63.6% in one day. That was the largest one-day drop ever.

The event is now known as "Silver Thursday." It was caused by two brothers – Nelson Bunker Hunt and William Herbert Hunt – who tried to corner the silver market by buying up futures contracts and physical silver. The brothers used loaned money to buy their positions and ended up defaulting on their loan margins. That caused a long-term bear market for the precious metal in which prices tumbled 94.5% to below $5 through February 1993.

Fortunately for silver investors, the silver price bear market has finally ended. And the current 12% gain we've seen in 2016 is just the start. Here are three reasons why we see the silver price climbing even higher throughout 2016…

Silver Prices 2016 Catalyst No. 1: Bullion Demand Soars

Consumer demand for bullion coins will be one of the primary catalysts for the price of silver in 2016.

You see, demand for American Silver Eagle coins has grown significantly in the last 10 years. From its debut year in 1986 to 2007, annual sales were only in the 3 million to 10 million range. Since 2007, coin sales have exploded 370%.

The U.S. Mint reported that sales of 1 oz American Silver Eagle coins hit a record 47 million in 2015. That was an increase from about 44 million in 2014. At an average price of $20 per coin, total 2015 sales came out to roughly $940 million. The Mint stated that 10.7 million 2016 edition coins were already sold in January and February.

And silver coin demand stretches far beyond the United States. January sales of Australia's Perth Mint bullion coins soared 152% from the same month last year to hit 1.5 million ounces.

"Bullish sentiment for physical silver has been strong and growing, as witnessed by coin and bar sales," Money Morning Global Credit Strategist Peter Krauth explained. "The effects of robust demand combined with shrinking supply promise to result in a much higher silver price."

And that's just the first catalysts we see for silver prices in 2016…

Silver Prices 2016 Catalyst No. 2: Renewable Energy

Krauth maintains that silver's application in renewable energy technology will have a major impact on silver prices in 2016 and in coming years.

Silver is an essential component in the photovoltaic (PV) cells of solar panels. When sunlight hits the silicon cells in silver, the reaction forms electrons and creates electricity. Silver's conductivity also enhances the sunlight, which improves the quality of the energy collected.

Every silver panel requires about two-thirds of an ounce of silver. Market research firm IHS Inc. (NYSE: IHS) reports global demand for solar panels is expected to grow by about 12% this year. Better yet, Statista projects the renewable energy market to hit a $158.4 billion valuation by 2023. That means the silver price will be first in line to benefit from increasing solar power use.

"Solar power is growing quickly, using up a hefty 11% of annually mined silver," Krauth explained. "With the average solar panel containing between 15 to 20 grams each, this industry is having a marked impact on silver demand and that should translate into higher prices."

Silver Prices 2016 Catalyst No. 3: The Federal Reserve

The third catalyst for the price of silver this year will be the Federal Reserve.

Minutes from the Fed's Jan. 26-27 meeting show policymakers appear increasingly reluctant to raise short-term interest rates at its next meeting. And that reluctance may persist throughout 2016.

Now, futures market traders see just a 50% chance the Fed won't raise rates at all in 2016.

That's bullish for silver prices this year. When the Fed raises interest rates, the value of the U.S. dollar increases, which also makes dollar-denominated commodities more expensive. This makes buying silver less affordable, which lowers demand and sends silver prices down.

So any time the Fed holds off on raising interest rates, you can expect the silver price to climb even higher. And the recent hesitation from Fed officials, has been bullish for silver prices already.

Because of these three catalysts, we expect silver prices to continue even higher from their 2016 highs.

Stay tuned at Money Morning for more updates on silver prices throughout 2016…

Three Reasons Silver Prices Will Continue to Climb

Silver prices haven't soared as high as gold this year, but that just means their potential to rise is even brighter… The price of silver has climbed 12% in 2016, which means it has handily outperformed the broader markets this year. So far in 2016, the Dow Jones Industrial Average, the S&P 500, and the […]

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5 Tips on Buying Silver

buying silver

These tips on buying silver will help you get started on the right foot when starting this type of precious metal investing.

Find out how and where to buy so you make the best decisions with your money...

Six Facts About American Silver Eagle Coins

silver prices

American Silver Eagle coins are a great way to preserve some of your wealth in a hard asset.

But before you buy, it's good to know all the facts. Find out more about these silver coins here.

Here's Where Silver Prices Are Headed in 2016

Silver Prices

While global stocks fell 10% earlier this year, silver prices gained nearly 8%.

That's why we're showing you our newly revised silver price forecast for 2016.

And even that price may be conservative...

Why the Price of Silver Had Its Best Weekly Gain in a Month

silver price

The price of silver had a standout performance last week.

It saw a weekly gain of nearly 6% -- the best since mid-March - and outperformed the price of gold by 6.8%.

And there's one important metric that will determine whether or not the metal sees more gains in 2016...

My Silver Forecast Shows When It Will Top $22

Price of Silver

One of silver's biggest strengths is its versatility...

It's a monetary metal, a proper currency. It's a critical industrial material used in everything from automobiles to solar panels. And of course it's an ornament, too, that people wear as jewelry.

Here's the thing... As diverse as it is, the global silver market is relatively "small"; as of 2014, the physical market had about $20 billion in play. So this versatility and small size can add up to volatility. The silver market can explode and recede like a wave, sometimes in very short order.

Silver's price is highly influenced by gold's price, too, though there are many other drivers and catalysts at work.

But right now, silver's relationship with gold and a combination of those other forces are all are working together to ensure that silver is unnaturally, incredibly cheap.

The white metal won't be "on sale" forever, though. I'm recommending we move right now, because I believe we're about to see a huge move up very soon...

Silver Prices Today Hit a Three-Week High Thanks to This $20.2 Million Trend

silver prices today

Silver prices today continued last week's rally by hitting their highest level in three weeks.

Better yet, news on the fundamental side is painting an increasingly bullish picture over the long term.

And it's mostly due to this growing $20.2 million trend...

The Silver Price Will Rise in 2016 from This One Buying Trend

silver price

As 2016 rolls on, the outlook for the silver price gets increasingly bullish. That of course is promising news for long-term silver investors.

Here's the one record-breaking trend that will ensure the price of silver climbs...

Why the Silver Price Will Climb Higher in 2016 Despite Fed Uncertainty

silver price

The silver price became increasingly unstable last week thanks to comments from the U.S. Federal Reserve.

In the near term, this weakness could well continue.

But as I'll show you, the farther out we go on the silver timeline, the better the outlook becomes...

3 Reasons the Price of Silver Will Rebound from Recent Lows

price of silver

The unyielding rise that boosted the price of silver over the last three months appears to be pausing right now.

Still, the silver price's gains have been impressive, and there are some indicators that point towards continued strength in the months ahead.

Here's what that means for silver investors...

Silver Prices Will Keep Rising in 2016 Thanks to One Figure

silver prices

The Fed's inaction last week was good for gold, but it was even better for silver prices.

Prices even broke above a psychologically significant level.

But even better, there's one metric that dialed back a bit, indicating that silver's gains are just getting started...

Silver Prices Today Showing This "Brilliant" Opportunity

price of silver

Silver prices are trying to regain footing and shake off recent volatility.

In the past trading week, we've seen the silver price gyrate up as much as 3.7% and down by 3.7%. While that may not sound like a lot, over such a short time frame, it's pretty fickle.

But a confluence of factors are combining to make silver a lucrative investment right now. Here's why...